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In 2014–2015 UPM invests €160 million
in the UPM Kymi pulp mill. The investment
will finance a new pulp-drying machine,
modernisation of the softwood fibre line,
a new debarking plant as well as work to
improve the energy balance of the Kymi
integrate.
Production capacity at the pulp mill will
increase by 170,000 tonnes, a move
further strengthening UPM’s foothold on
the global pulp market.
The investment has significant multiplier
effects locally, regionally and even
nationally. Wood consumption will
increase by almost one million cubic
metres, requiring 25 new harvesting lines.
Stumpage earnings for forest owners will
increase by more than €30 million.
In the building phase, the investment
will increase employment, income and
purchasing power in the area. The project
currently employs around 300 people,
with roughly 20 local contractors involved
in the project.
The investment also generates new
business for the chemicals industry and
creates employment opportunities in
logistics through product and raw material
transports. The forest industry currently
employs about 6,300 people in southeast
Finland.
WHY IT PAYS
TO INVEST
earnings for forest owners could climb as high as €350million per year.
However, there is a challenge: Almost one third of Finland’s commer-
cial forest area has not beenmanaged or felled over the last 30 years.
Increasing wood supply also requires committed efforts from the govern-
ment.
“Currently, passive forest owners are not encouraged to trade their
wood andmanage their forests,” affirms Sundman.
Thinking bigger
“We should encourage the formation of larger forest properties rather
than splitting themup,” he adds.
With forest properties shrinking in size, owners are less motivated to
manage them. Measures promoting larger forest properties could include
tax relief when land is passed to the next generation, or a fixed-term tax
exemption in sales profit when smaller forest properties are integrated.
Another novel approach to increasing wood supply is the new type of
jointly owned forest that UPM is promoting.
Efficient wood supply also requires an optimum infrastructure for
transporting wood. The miles of paved road in need of repair will triple in
ten years, and the financing gap for their repair will increase annually by
€250million.
Renewable future
“The forest industry has a notable impact on employment. The sector is
also important in terms of export revenues. If Finland hopes to maintain
its significant role in wood processing, we have to secure wood supply both
for current mills and future investments. To promote economic growth,
we must make sure that new investments will not simply directly replace
smaller mills.”
A proactive approach to forestry is the best climate policy. The planned
pulp investments are estimated to increase renewable energy production
in Finland by approximately three percentage points.
“Pulpmills produce a vast amount of renewable energy.
It is therefore crucial that we build a sound future for of our bio-refineries
and pave the way for new investment,” concludes Sundman.
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